As his customer base grew, he said, buyers wanted assurances that their property rights would be protected.

So Hope started his own government in 2004, which has a ratified constitution, a congress, a unit of currency—even a patent office.

"We're now a fully realized sovereign nation," Hope said.

The trouble is that, legally, nobody can own the moon or anything else in space, for that matter, said Tanja Masson-Zwaan, president of the International Institute of Space Law, based in the Netherlands.

"What Lunar Embassy is doing does not give people buying pieces of paper the right to ownership of the moon," she said.

The controversy began in 1980, when Hope registered his claim to the moon with the United Nations. The claim went unanswered, so he figured his rights were secured.

To date his company has sold more than 2,500,000 1-acre (0.4-hectare) plots of lunar land, which Hope says are rich in an isotope of helium that has an earthly price tag of about U.S. $125,000 an ounce.

Today a deed for a plot, printed with the buyer's name, is selling online for $22.49, plus tax.

Legal experts counter that the UN didn't answer because it didn't have to: The moon is unclaimable under the 1967 Outer Space Treaty, which has so far been ratified by 100 UN member countries, including the United States.

Hope, however, said there's a loophole.

The treaty prohibits countries from claiming property in space, but "I filed my claim of ownership as an individual."

The fact that he's now claiming his Galactic Government has legal authority over the moon might seem problematic. But Hope said that the fledgling regime isn't a member of the UN and so doesn't have to abide by its laws.

Regardless of his current stance, Hope's original claim to the moon is simply not legal, the space-law institute's Masson-Zwaan asserts.

The UN treaty does apply to governments and their private citizens, which invalidates Hope's claim to the moon and other celestial bodies, she said.

But that shouldn't disappoint any prospective moon millionaires.

You don't need to own a place to make money on it, Masson-Zwaan said. But you do need a clear legal framework for doing business on the property—something the moon currently lacks.

A separate 1979 treaty known as the Moon Agreement sets up a framework for establishing clearer rules for managing the moon's natural resources, once the use of those resources becomes feasible. Such rules would apply to businesses looking to establish hotels, mining operations, and other commercial endeavors on the moon.

That agreement, however, has been ratified by just 13 countries, none of which are major spacefaring states.

Moon "Just Another Continent"

One of the main hang-ups with the 1979 treaty is how countries would share the wealth.

Some scientists think stores of helium-3, for example, could make the moon the next Persian Gulf. The gas, which is rare on Earth, has been tagged as a clean, renewable energy source of the future.

For billions of years the moon, unprotected by an atmosphere, has been showered with particles from the sun. This includes an as-yet undetermined amount of helium-3, which is now trapped in the moon's soil.

Its use as a fuel, though, hinges on developing a reliable process for fusion, a form of power generation that's "like a controlled hydrogen bomb explosion," said Peter Kokh, president of the nonprofit Moon Society.

Other more immediate uses for the moon include mining moondust for lunar construction, launching satellites, and setting up solar-power collectors, Kokh said—projects for the first wave of moon settlers.

The moon "is just another continent across a different kind of sea," he said.

"We foresee a future in which people will be living on the moon and producing materials for solving Earth's problems."

United States of the Moon?

Kokh personally thinks that the best possible future is one in which the people of the moon rule themselves.

The process of colonizing the moon's challenging landscape will change the needs and wants of the society that settles there—just as the desires of English colonists changed when they got to the New World.

"Lunar settlers may want to bring the American way of life to the moon, but they will leave Washington, D.C., at home," he said.

"In the meantime it'd be better to have UN stewardship," Kokh said. "Right now [the world has] a working international relationship in the International Space Station ... and that's a good precedent."

Space-law expert Masson-Zwaan agrees, saying that the first bases built on the moon should be cooperative projects.

"I don't think we'll have people putting in their flags and saying, This is my little square, and I'm going to build a base here," she said.